The ‘industry’ is once again at the doorstep of the law. This time the nine-judge Constitution bench of the Supreme Court has heard it and reserved its decision. This hearing took place in the State of UP vs. Jai Veer Singh case. On the other hand, in another case regarding the industry, two judges of the Supreme Court, Justice Arvind Kumar and Justice Prasanna B Varale, clarified that temple trusts are not industries. On this basis, the Supreme Court legalized the dismissal of an accountant but also ordered him to pay a lump sum compensation of Rs 12 lakh.
In the context of both these cases, it is now necessary to find answers to some questions. What is the issue of dismissal of the accountant of the temple trust? Why was a Constitution bench of nine judges formed? What definitions have come out in the form of law regarding the industry since independence till now? Let us understand in detail.
What is the controversy regarding dismissal of Temple Trust employee?
It starts from Gujarat in the year 1977. An accountant is appointed in Lakshmi Narayan Dev Trust. They provide continuous service. After a few years, the trust dismisses the employee without any concrete reason. When the employee requested for reappointment, the trust ignored him. The matter first reached the Labor Court. The court dismissed this case with the argument that the defendant trust conducts religious activities. The labor court said that the trust does not come under the Industrial Disputes Act. This decision of the Labor Court was upheld by the single judge bench and then the division bench of the Gujarat High Court.
Supreme Court.
Then the matter reached the Supreme Court. Here the judge did not interfere in the decision of the High Court. Rather it also said that temple trusts do not come within the scope of industry. However, the Supreme Court ordered that the Trust pay a lump sum of Rs 12 lakh in lieu of serving the Trust for years on humanitarian grounds. If this is not done, nine percent interest will also have to be paid. The Supreme Court gave this decision last month.
Then why was a bench of nine judges formed?
Supreme Court Advocate Ashwani Kumar Dubey says that a case of State of UP vs. Jai Veer Singh came before the Supreme Court in the year 2005 with a request to define the industry. Since a seven-judge bench of the Supreme Court had defined the industry on the same issue in 1978, a nine-judge bench was required to hear this case. He says that a lot has changed in the years since 1978. In such a situation, it was necessary that the definition of the industry be decided afresh. With this intention, the Constitution bench of the Supreme Court has completed the hearing of this case. The decision is reserved. Whenever this decision comes, the new definition of the industry will be in front of the country.
Industry is not limited to factories
The word industry has great importance in India. This is not limited to factories only. It is a broad term related to employment, production and services. Industry is the basis of the country’s economy, hence its legal definition has also been clarified. It has been specifically defined in the Industrial Disputes Act, 1947. This definition was further expanded in the year 1978. Now it will be interesting to see and know how the Constitution Bench of nine judges of the Supreme Court redefines the word industry?
chemical industry
What is the general meaning of industry?
The general meaning of industry is to produce a good or service or provide a service in an organized manner. When people work together regularly and get remuneration in return, that activity is called industry. There are three major factors involved in the industry. Organized activity, the relationship between employers and employees, and the production or distribution of goods or services.
What was the definition of industry decided in the year 1947?
The Industrial Disputes Act, 1947 is an important labor law in India. The purpose of this law in independent India is to resolve disputes between employer and employee. The definition of industry is also given in Section 2(h) of this Act. According to this, any organized activity which is carried on with the cooperation of employers and employees, the purpose of which is to produce, supply or distribute goods or services, whether or not the objective is to make profit. Will fall under the category of industry.
This law says that it is not necessary to make profit in the industry. It can be either private or government. The service sector can also be included in the industry. Hospitals, educational institutions etc. can also be considered industries under certain circumstances. In the law of 1947, some activities have been kept out of it. This includes farming, armed forces, domestic service, sovereign functions like police and judiciary etc.
The definition of industry got expanded in the year 1978
Advocate Ashwini Dubey says that in the year 1978, a seven-judge bench of the Supreme Court ruled in Bangalore Water Supply vs. A. The definition of industry was clarified in detail in Rajappa case. This decision is considered historic. The Supreme Court gave a triple test i.e. three conditions were set for identification of the industry.
- There should be an organized activity. Work should be systematic and continuous.
- There should be a relationship between employer and employee. The working people should be working on salary or remuneration.
- Three-Production or distribution of goods or services. This work should be to fulfill human needs.
The Supreme Court said that if these three conditions are fulfilled, then that activity will be considered as industry. After this decision the definition of industry became very broad. After this decision many institutions came into the category of industry. These include hospitals, universities, research institutes, clubs and cooperative institutions. If employees in these institutions work for wages and services are provided, then they can be considered as industries. However, the Court also said that purely charitable or religious activities would not be industries if they did not have a commercial element.
The government made amendments after four years
The government made some necessary amendments in the definition of industry in the year 1982. Its purpose was to limit the definition. Some activities were clearly excluded in the revised definition. These included agricultural work, hospitals, educational institutions, scientific research institutions, Khadi and village industries, some institutions with less than 10 employees. But this amendment was not implemented for a long time and the court’s interpretation was more effective in practice.
Role of industry in Indian perspective
India is a developing country. The importance of industry is very high here. Employment generation, economic development, export growth, technological progress, urbanization etc. are expanding through industries. IT, banking, health and education have also become part of modern industry. Therefore, it is natural to increase the scope of the legal definition of industry.
Industry and labor rights
The definition of industry is directly related to labor rights. If an organization is considered an industry, then the employees working there get certain rights. The main ones include the right to raise industrial disputes, the right to strike within legal limits, protection of layoff and closure rules and protection of service conditions. Therefore it is very important to decide whether an organization is an industry or not.
The role of courts is important
The Indian judiciary has clarified the definition of industry from time to time. The Supreme Court first expanded this case in the year 1978 and now the decision of the Constitution Bench of nine judges of the Supreme Court is safe. It should be expected that after the arrival of the latest decision, some more things will definitely be added to the scope of the industry. Thus, the objective of any law related to industries is to provide protection to the workers. This should not be thought of within a very narrow scope. Also, it should be kept in mind that sovereign work should not fall in the category of industry.
In this way it can be understood that industry does not only mean factory. This is a broad concept. The Industrial Disputes Act, 1947 gave it legal form. The Bangalore Water Supply case of 1978 further expanded its scope. Triple test makes industry identification simple. It is not necessary to make profit. Service sector can also be an industry. And now we should wait for the decision of the nine-judge Constitution bench of the Supreme Court, in which the industry will get a new law or the existing law will remain intact?
Also read: Not only Saudi Arabia, many countries celebrate Eid before India, know why